GAS SERVICE EXTENSIONS.

Otago Daily Times, Issue 20591, 14 December 1928, Page 8

GAS SERVICE EXTENSIONS.

The City Council has referred back to the Gas Committee a recommendation that the city gas service should be extended to Green Island. It'has adopted this course from prudential reasons, being desirous of a more explicit assurance than was offered to it on Wednesday evening that the undertaking would not be one involving, the department in a serious loss. The initial capital' outlay, according to the estimate quoted, would be about £7500. The chairman of the Gas Committee claims to have had a definite undertaking that more than a hundred householders will initially make use of the gas when it is. brought into the borough and that their consumption will yield on the average a revenue of 15s per month. This seems to be a high estimate of the gas bill for the ordinary household. If it can be accepted, however, the proposal may well appear to be sufficiently sound, always provided, of course, that the estimate of the cost of the extension is not likely to be exceeded. Councillor Clark calculates that the council will incur a loss of about £3OO a year if it goes on with this work. There should not be any such loss if the Gas Committee's expectations are realised, but Councillor Clark would seem to have some justification for referring to the estimate of the probable receipts as "a very rough idea." It would no doubt be desirable if the committee were to obtain, as presumably it might do, more definite and exact information respecting the prospects.of this project. If only it can satisfy

the council on this point, the proposal generally bears the appearance 'of being a progressive one that would not only be advantageous to the borough of Green Island but advantageous also to the City Gas Department, in enabling it to extend its operations and find a larger market for the useful commodity which it is able to supply in a volume exceeding the present demand. But the council cannot afford to saddle itself with an unprofitable undertaking. The chairman of the Gas Committee has expressed the. view that the question of the extension being remunerative is a small one in the meantime,' the main consideration being that the extension may lead up to additional business. It may ,be agreed that. the council should not be looking for any substantial immediate profit in circumstances of this kind, since the service is one that should develop considerably. It is only proper, however, that the council should receive some guarantee that it will not incur loss through this proposal to take the gas service outside the city boundaries and that it should show due regard for the position of its trading departments. But Jf the Gas Committee can convince it that its views of the prospects is by no means unduly sanguine' there should be little hesitation on the in sanctioning the extension even though it may hot be actually profit-producing within the first’few months of its inauguration.